NOTICE
Government Shutdown – Loan Impacts & Keystone Funding Policies
Dear Partners,
As you are aware, the federal government shutdown is impacting several lending programs. We want to provide clear guidance on how Keystone Funding is handling loans during this period so you can set expectations with your clients.
Flood Insurance
- The National Flood Insurance Program (NFIP) is not issuing new flood insurance policies during the shutdown.
- Keystone will continue to require flood insurance on properties located in a flood zone.
- Private flood insurance may be used to satisfy this requirement, provided the coverage meets all applicable agency guidelines as well as Keystone’s standards.
USDA Loans
- USDA is not issuing new Conditional Commitments during the shutdown.
- Loans without a Conditional Commitment cannot close until commitments are being issued again.
- Loans with an existing Conditional Commitment may close, provided there are no changes requiring an updated commitment.
Borrower Employment Status
- Loans for borrowers who are furloughed due to the shutdown cannot close until the government resumes operations.
Rate Lock Extensions
Locked loans that are impacted by these changes and require an extension will be reviewed on a case-by-case basis. Our team will work with you to evaluate each situation individually and provide support where possible.
FHA & VA Delays
We also expect delays on loans that require escalation to FHA or VA, as well as additional time needed for VA agent approvals. Please plan accordingly when submitting files with these requirements.
IRS & SSA Verifications
At this time, we are not seeing delays with the processing of 4506Ts or Social Security number validations. However, these services could experience disruptions as the shutdown continues, and originators should plan for that possibility when managing loan timelines.
We understand these disruptions create challenges for you and your borrowers. Our team is committed to monitoring the situation closely and will provide updates as conditions change. Please reach out to your Keystone contacts with any loan-specific questions.
Thank you for your continued partnership,
Keystone Funding, Inc.
